Page 15 - DMEA Week 36

DMEA REFINING DMEA

Iraq reaches out to Eni for 300kbpd refinery

IRAQ IRAQ is in negotiations with Italian oil major to fund budget spending after suffering a steep
Eni on the construction of a 300,000 barrel per decline in oil revenues because of low prices and
Iraq has been looking day (bpd) refinery in its south-west, Oil Minister OPEC+ cuts.
to build out its refining Ihsan Ismaael said on September 7. The ministry will have off-take contracts to
sector for decades, but The plant would be supplied with oil from guarantee the sale of the refinery’s products,
progress has been slow. the nearby Zubair field, which Eni operates with including gasoline, gas oil and lubricants. All of
a 41.6% stake, the minister explained. South these fuels will be consumed locally, the ministry
Korea’s KOGAS has a 23.8% interest in the field, said.
while the remaining share is held by state-owned Many of Iraq’s existing refineries are old and
companies. in need of modernisation or were damaged
Zubair is slated to produce 700,000 bpd by during the 2013-2017 conflict with the Islamic
2027, Ismaael said, without disclosing its cur- State. Ismaael in late August ordered the pro-
rent output. cessing capacity of the Sumood oil refinery in
Iraq has been looking to build out its refining Baiji to be raised from its current 75,000 bpd to
sector in order to cut down on fuel imports for 140,000 bpd within a few months and eventually
decades, but progress has been slow because of to 280,000 bpd. That plant sustained significant
conflict and financing difficulties. damage while occupied by IS fighters and when
Baghdad wants the Iraqi private sector to take it was retaken by government troops.
a 20% interest in the proposed plant near Zubair, Japan’s JGC has also been chosen to build a
as the government currently lacks the resources catalytic cracker and other new processing units
to play a role, Ismaael said. Baghdad is struggling at the Shuaiba refinery outside Basra. ™

LNG

Renergen hails LNG auctions as success

SOUTH AFRICA RENERGEN said last week that its upcom- to buy for future production streams of LNG and
ing LNG auctions, the first of their kind in helium from Renergen’s LNG plant. The facility
The interest shows South Africa, had attracted more interest than is currently under construction and due to begin
there is room on the anticipated. commercial operations in 2021.
market for new types of Stefano Marani, the company’s CEO, told the The South African company is building its
fuel, Renergen has said. press last week that Renergen had not expected LNG plant in two stages. In the first stage, it
so many companies to register for the auctions. will connect its natural gas wells near Welkom,
“We expected some interest but certainly not the Virginia and Theunissen in Free State to a new
level received, with significantly more compa- pipeline and also build the gas liquefaction plant
nies involved in the auction process than we had and a helium plant.
forecasted,” he said. The latter facility will process helium from
This high level of interest shows that there is Renergen’s fields, which contain unusually high
room on the domestic market for new types of volumes of the noble gas. Sproule, an interna-
fuel, he added. “Many companies in South Africa tional energy consulting firm, estimates that
have their own procurement departments deal- these sites may contain as much as 9.74bn cubic
ing in energy, and an auction such as this would metres of helium, or more than the total proven
never feature in their operational processes. reserves of North America.
However, we were pleasantly surprised to be Once the gas liquefaction plant comes online,
proved wrong,” he commented. the company will halt production of CNG and
Marani did not name any of the interested switch to LNG. It has already arranged to work
parties. He was speaking shortly after Renergen with a unit of France’s Total to sell its LNG as a
closed registrations for the auction on August 28. fuel for long-haul trucking. Total will use its fill-
The next step for registered bidders is to sign ing stations along the Johannesburg-Durban
non-disclosure agreements (NDAs), the CEO section of the N3 highway to distribute LNG
said. After meeting this requirement, partici- from the first phase of Renergen’s plant.
pants will have until the end of October to final- The second stage of the LNG plant will then
ise and submit their bids, he stated. begin production in 2023. Part of the produc-
“We now look forward to completing the tion from the second stage will be distributed
information-sharing process and assessing all by Total’s retail outlets along all of South Africa’s
bids received,” Marani said. major highways, and the remaining volumes will
The winners of the auctions will have the right be sold to other buyers. ™

Week 36 10•September•2020 www. NEWSBASE .com P15